Midcap crash: Sebi relief to six firms, bar on two to continue

Market regulator Sebi today revoked its earlier order barring six entities which were initially found involved in the share price plunge in some mid-cap stocks, including Parsvnath, Tulip Telecom and Pipavav Defence.

Press Trust of India | Last Updated: December 20, 2012 23:17 (IST)

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Mumbai:

Market regulator Sebi today revoked its earlier order barring six entities which were initially found involved in the share price plunge in some mid-cap stocks, including Parsvnath, Tulip Telecom and Pipavav Defence.

However, the board continued its gag order against two firms - Gajria Jaayna Precision Industries and Passion System Solution -- passed on August 3 by confirming their suspension from trading after finding "prima facie" evidence against them.

"In view of the foregoing, I, in exercise of the powers conferred upon me... hereby confirm the directions issued against Gajria Jaayna Precision Industries and Passion System Solution and revoke the directions issued against A to Z Steels, G N Credits, Premium Hospitality Services, 4a Financials Securities, Venus Infosoft vide ad-interim ex-parte order dated August 03, 2012," said Sebi in an order passed by its wholetime member R K Agarwal on December 19.

Meanwhile, the board made it clear that investigation in this issue is still going on and SEBI may take a final view and necessary actions after that.

Regarding the six entities, Sebi observed that at this stage, the case has not been made out that their trades were part of any alleged plan and the investigation in the matter was still in progress.

"It is noted that the notice has already undergone restraint for more than four months pursuant to the interim order. In my view, in the facts and circumstances of the case, the balance of convenience is in favour of the A to Z, GN Credits, Premium, 4a Financials' and Venus at this stage," said Sebi.

However, regarding the two entities, Sebi said, "Gajria and Passion have not been able to make out a prima facie case for revocation of the interim order as against them and the material available on record justifies the continuation of the directions passed against 'Gajria' and 'Passion' issued under the ad interim ex-parte order dated August 3, 2012".

Passing an interim order on August 3, 2012 Sebi had barred 19 entities from the securities market after an initial probe into share price plunge in some mid-cap stocks, including Parsvnath, Tulip Telecom and Pipavav Defence.